Groundwork’s Lindsay Owens on FTC’s Click-to-Cancel Rule: “This new rule will put a stop to this predatory pricing model”
October 16, 2024
Groundwork’s Lindsay Owens on FTC’s Click-to-Cancel Rule: “This new rule will put a stop to this predatory pricing model”
Today, the Federal Trade Commission finalized its “click-to-cancel” rule for subscriptions after receiving more than 16,000 public comments. The final rule requires businesses to make it easy for consumers to cancel a subscription and institutes strong protections against misrepresentation and new requirements for informed consent and disclosure. Groundwork Collaborative Executive Director Lindsay Owens applauded the final rule with the following statement:
“Companies are no longer content to overcharge you just once. Now they are deploying deceptive subscription models to overcharge you as many times as they can for as long as they can.
“Consumers shouldn’t have to navigate a Rube Goldberg machine to get out of a subscription they purchased with a keystroke. This new rule will put a stop to this predatory pricing model, saving consumers time and money.”
Email press@groundworkcollaborative.org to speak with a Groundwork expert about predatory pricing tactics.
BACKGROUND
- Groundwork’s collaboration with The American Prospect for an issue on “How Pricing Really Works” dove into subscription pricing in “The One-Click Economy,” which highlights the FTC’s “click-to-cancel” rulemaking.
- McKinsey found that businesses offering subscriptions grew by more than 300 percent from 2012 to 2018 and according to Statista, spending on subscriptions is estimated to grow to $1.26 trillion globally by the end of 2025.
- The “click-to-cancel” rule is overwhelmingly popular across party lines — supported by 83% of voters, including 85% of Democrats, 86% of independents, and 80% of Republicans according to polling.
- With rules and enforcement in place to ensure that subscriptions are easier to cancel, people will have the peace of mind to try new subscriptions. This is a rule that benefits honest marketing.
